In my line of work the buzzword for the past few years has been ‘purpose’. Whether its large companies re-framing their sustainability strategy around purpose, recruiters looking for a “purpose fit” for graduates or individuals stepping forward to declare their ‘reason for being’ – the word purpose is everywhere. Purpose and happiness have been presented as inextricably intertwined. It is supported by the rise of positive psychology, by research on millennial’s that states “young people want more than a pay check and a job title”. Its importance has been further reinforced by leading thinkers like Victor Frankl and the seminal book ‘Man’s search for meaning’ and popular writers like Simon Sinek and his “Start with why”.

I work with leaders for positive social and environmental transformation. Over the past few weeks, I’ve noticed that this need for purpose is creating considerable anxiety. “But what am I here for…?” one person asked. Another said, “I love my work, but it is not aligned to my purpose in the world – how do I change this” and still another bemoaned her “lack of a clear purpose”. All these people feel guilty, restless, disappointed or lost for not having a clear purpose to direct their lives.

I support the overall societal goal to contribute and believe we all have a role as citizens to work towards a better society. And yes, people can be happier when they are able to see the relevance of their life and work with the context of a grander design. However, I’m starting to question the centrality of the ‘purpose’ conversation. Let’s scratch beneath this ubiquitous word…

Sometimes the need to find a purpose is an inner cry to find a reason to exist. It’s a sneaky cover-up for that old, rough feeling of ‘not being enough’. In this case it’s often a way of externalising inner need instead of addressing the root cause. Yet, anyone who has truly found purpose understands that it can only come from a deep sense of and understanding of ‘self’. Perhaps Socrates had it right when he said that to ‘Know Thyself’ is the route to all wisdom. So, start with who you are not why you exist.

At its worst this push to find purpose can play into the idea that we are only on this planet to serve and that our value is measured solely by our value to others. It’s a mirror of the current socio-economic systems that measures the value of humans against contribution to GDP, sets meaning top-down and sees people as homogenous, interchangeable units. This is a nasty trap both because it erodes the basis of our humanity and because it sets the value of a human life as extrinsic. A healthier alternative is to believe that the only thing we are compelled to do is live each day fully and gracefully, in gratitude for our place here on earth and with no pressure to focus our energy on finding any additional meaning. Surely people can be happy and feel satisfied with their life simply by getting up each day and going for a walk, hugging someone they care about, being kind and watching the clouds go by? The catch-all umbrella of ‘purpose’ mimics the existing system of control by creating a collective aspiration that is outside of individual needs, aspirations, talents and, therefore, humanity. Tom Mansfield, a fascinating thinker, comments “Perhaps we cannot reconcile our present individual fulfilment with systems level purpose until we have an economic paradigm that forces the system to work for individuals not the other way around to value the quality of our subjective, sensorial present. A collective purpose may emerge from a society predicated on the enrichment of each individuals sensorial present rather and the pursuit of extrinsic goals.” Perhaps he is right.

The idea of a single purpose may also be misleading. As we journey through life new vistas are revealed and, with that, our purpose may shift and expand. Trying too hard to cling to an outmoded world-view may stop us from growing and learning. Perhaps the ‘purpose’ of life is only to grow and learn our way through and into different ways of unfolding our unique talents against emergent positive societal needs.

Lastly, the idea of purpose sets a longer time frame on our happiness. It shifts our focus from enjoying the present to a loftier future time. Yet, it is precisely in the moment that we create meaning for ourselves. By being truly present in the moment we connect better with ourselves and others – two potential sources of joy!

Perhaps then, for those millions who can’t state their purpose, there is a softer way to move toward it. They can start by asking themselves what gives them meaning and then each day noticing those things that make them feel more fulfilled. By doing more of the things that deepen their experience of being, they are consciously building a life that grows around both knowing themselves and, ultimately, serving a higher collective purpose.

With gratitude to Tom Mansfield and Gita Parihar for their thoughts on this topic.

I’ve been lucky enough to work with the wonderful Dina Epifanova, Head of Sustainability at Tetra Pak and her team in Moscow. Here she shares a how system change tools and mind-sets are giving her more muscle where it matters.

Why is system change valuable to you?

If you want to make a real step change in sustainability, addressing complex social and economic issues, you need to have a strategic mindset and work cross-borders. Influencing factors in our globalizing world goes far beyond a local or isolated context. To succeed in this environment, we need to adopt and use a systematic approach in our daily routine.

When you use system change frameworks, you harness greater potential and leverage to reshape the things of concern. To give an example, I applied the framework of ‘Landscape, Regime and Niche’ levels of system change to our recycling development challenge. This brought new perspectives: for instance, at the landscape level, we looked at whether the communities were ready to implement separate waste collection. Earlier, we had considered it as a communications task to engage people with new ways of treating their household waste: challenging and potentially expensive in terms of effort and investment, but still manageable. With the ‘landscape level’ lens, we realized it is not that simple: you need to consider whether communities wish to change their habits. This is not a manageable object, but a variable one, that influences and even determines the probability of your success in change management here. So, now, when analyzing where we should start deploying separate waste collection in Moscow, we compare the districts, based on their communities’ readiness to sort out waste. We have some data, available from waste management companies, that reveals where there is a lot of potential, due to the social characteristics of the given population, that unexpectedly have huge amplitude in one and the same city.

I also had an unexpected and valuable insight: just how much attention a system changer should ideally pay to his own role and personal development as the driver of the change. This has brought me to another level of self-reflection and system change capability. I’ve also found this useful for other spheres, such as self life-coaching.

I believe corporates should start a more decisive walk towards this kind of knowledge and skills.

How else does system change feature in your work today?

Being Head of Sustainability at Tetra Pak, I face system challenges in three major areas: climate change commitments, Forest Stewardship Council-certification deployment, and post-consumer waste recycling. For all of these challenges, we can no longer afford to create ‘faster horses’ – to refer to Henry Ford’s metaphor: we absolutely need new ways of moving forward.

How does Tetra Pak approach system change?

At Tetra Pak, we realise very well that the modern world is changing rapidly, and we have consciously focused on change management capabilities and tools. System change complements this approach, and is crucial to meeting our sustainability goals.

The first thing on the agenda today is to actively search for the right allies to drive environmental issues at full speed. Our indisputable benefit here is our long-term approach, which has been always in the company DNA. Our Scandinavian corporate culture complements our sustainability efforts. We are ready to lead the process, rather than wait for requests from our customers or consumers. To achieve success in any systemic change, someone needs to take a risk and become a moving force to lead the process of change.

What is the appetite for system change in the regions where you work?

The level of societal maturity affects the appetite and need for system change and a sustainability agenda. I work in the markets of Eastern Europe, Caucasus and Central Asia. Here, a company seeking to advance sustainability faces two major challenges. One is that local markets and infrastructure are not yet at the level of the advanced consumer when it comes to sustainability. A buyer can face frustrations when wanting to find out if a carton is FSC-certified or not, or find themselves pushing for separate waste collection.

On the other hand, now is a great time to push for this kind of change in the region, as most of these countries find themselves currently in big shifts. This means consumer mindsets are moving and prepared for the change, with sustainability no exception.

How ready do you feel various countries in the region are to embrace system change?

All countries here are now going through major historical system changes, in the scale of decades or even centuries. This, on the one hand, makes the societies quite adapted and ready for changes, but on the other, if recent changes were too painful, it can have an opposite effect, resulting in huge demand for stability.

We will see, for instance, in Ukraine – a country of believers in European values and political practices – readiness for change is high. In Russia, on the other hand, the changes that the country has gone through in the recent decades were so painful that the majority of the population is keen to keep stability.

The paradox is that years of rather short-term decisions, especially in economics, have brought Russia to the point where system change is critically needed to keep any equilibrium: without it, wider changes will inevitably catch the country unprepared.

What ways forward do you see for Russia?

Even though the appetite for system change here is the lowest in the region discussed, you can nevertheless easily find two powerful sources of system change here. The first is the government: the political elite understands clearly the need for change – satellites fall down, weapons are not that good, economic reserve has been used and eaten, political ideas have up short too: take Syria for instance. As in Mikhail Korostikov’s “honey-badger doctrine” the current political strategy is very effective, but works for survival, not for growth.

The good news is that the government puts this need for change into action. One example is appointing a 35-year-old Maxim Oreshkin to be the Minister of Economic Development, with a personal assignment from Mr. Putin to implement effective KPI-based frameworks to raise the professional level of management and, if successful, to scale the practice to other ministries.

Another source of system change in Russia is the new generation, which hasn’t the trauma of the 1990s’ hunger and criminal years, and which now lives in the completely new reality of the digital world, with no sense of limitations. Any serious barrier that they will face later will be absolutely not understandable and not acceptable to them! These young and free-mind people will be big change drivers: we only need to wait some 10-15 years.

As Vladimir Trofimchuk, Trade Policy Department Consultant at Eurasian Economic Commission, puts it: each country of the former Soviet Union block is now shaping its national identity and has to refresh its understanding of its political allies. All of them are facing now changes in politics, economics and even religion (for instance, the rise of Islam in Azerbaijan). This is creating a different appetite for system change, depending on the specific situation in a separate country. What the different countries have in common is that the whole region is today in tectonic system change process and this is a huge opportunity knocking.

On Friday, Government delegations from Nigeria, Colombia, and Mexico presented their climate finance propositions to a diverse group of investors, at the close of the week-long Climate Finance Accelerator.

These engaging read-outs of their learnings marked the culmination of 5 intense days where country delegations worked alongside the finance community to test and develop climate finance plans. The delegations were praised by Aziz Mekouar, from the Moroccan COP Presidency, for “showcasing leadership and forward thinking”, by taking part in this first Accelerator. The delegates themselves showed remarkable progress and cohesion – remarking on how impressed they were with the commitment of the financiers to supporting them in developing bankable pipeline.

The climate imperative for all stakeholders

Private sector, Governments and NGO’s reiterated that there is no alternative to action on climate change. Steve Waygood, our host from Aviva, spoke of climate change as a business imperative with Aviva committing to invest £500m annually in low-carbon infrastructure projects and actively diversifying out companies that are not responding to the climate agenda. Mr. Mekouar set the bar high “We shouldn’t speak of climate finance”, he said “all finance needs have a component of climate.”

The countries presented exciting opportunities but showed that there is no ‘cookie-cutter’ approach to financing, even across the same sectors, as each country’s context differed

Miguel Angel Gomez from the Columbia delegation had three key messages for his audience: Columbia has ambitious goals, the institutions necessary to deliver these goals are in place and there are bankable projects underpinning them. He presented a sustainable mobility plan for Bogota that, using the proposed Metro as the core, creates an extended proposition to increase climate impact by integrating with other modes of transport such as cycling. The $4bn capex required is proposed to be funded by a mix of trade finance and green bonds. Columbia overcame the issue of fragmented finance requirements in both energy efficiency and agriculture by proposing an ESCO structure and Climate Smart Ag fund, respectively, that would each aggregate smaller projects into more attractive / “mainstream” investments size-wise. The ag fund was worked out during the course of the CFA as the country delegation and financiers from BNP Paribas and Enclude looked for ways to move away from small, single, idiosyncratic projects likely to be dependent on grants, to more commercially sustainable structures. Colombia also identified $ several billion of further NDC related projects requiring finance, in just the transport, energy and agriculture sectors.

Giesela Meindez and Daniel Chacon-Airaya presented on behalf of the Mexico delegation. They focused on energy and transport, which together make up 50% of Mexico’s carbon emissions. An e-taxi pilot project to convert 2700 taxis in Mexico City (2% of fleet) and Colima (40% of fleet) was proposed. In addition, through clever structure to reallocate existing subsidies, devised during the CFA as a result of the team’s work with HSBC, a further project to provide solar for 25 million households and 4 million SMEs was put forward.

Olukayode Ashuolu from Nigeria’s central-bank sponsored agriculture guarantor NIRSAL, presented an electrifying speech on behalf of the Nigerian delegation. He spoke of his governments’ strong commitment to NDC-related projects, as they are vital for climate compatible development, diversification of the economy and economic and social inclusion. Nigeria’s initial NDC plan has outlined more than $142bn of investment. Working wth Deutsche Bank during the CFA, they had identified 8 projects for immediate focus in the agriculture and energy sectors.

A statement by Ha Han Nguyen from the Vietnam delegation, who observed the weeks proceedings, confirmed her country’s eagerness for further future engagement in the CFA process, for which a funding package is now being sought.

All speakers remarked on the value of the Accelerator and the pre-London processes run in-country to bring together people who needed to be at the same table. In a panel, country representatives discussed their thoughts from the week’s proceedings. Some of these were:

“We [governments and financiers] speak different languages, but we can learn to understand each other”

“We need to enhance dialogue between the private and public sector at international, but also local levels, to know what is already happening inside the country [finance-wise] and to leverage that”

“There is a huge amount of focused work required to move from plan to projects to desired outcomes and results”

“Climate finance is still finance, and needs to manage risk and be linked to returns”

“We need access to international funding to enable us to pursue larger projects outside boundaries of local finance and to access other networks and knowhow”

The rigour and attention to detail of investment bankers is vital to successful climate projects

In a panel with the investment banks which had worked with the country teams, Tessa Tennant praised the bankers for their commitment to the process – even earning the kudos from one country delegation of “these bankers, they’re actually quite nice”! She spoke of the importance of having term sheets to act as ‘dictionaries’ between financiers and policymakers, to ensure everybody understands and can act on the spectrum of issues that need to be addressed to get projects over the transaction line.

Graham Smith from HSBC spoke of three considerations to access finance: ensure the rule of law is in place (i.e. contracts enforceable and protected), know your customer (clarify if the mandate allows for customer type and country risk, and ensure the right people are on board); and lastly, check that the project is ‘bullet-proof’ (i.e. practically workable in context).

Bankers spoke of their delight to discover that dialogue was constructive and friendly and were impressed by the interest of the delegations in unpicking what risk really meant. They were pleasantly surprised that their colleagues from other parts of their institutions were also interested in the opportunities and ready to get involved. They saw the CFA as a ‘deal-flow network’ and all were keen to stay involved with this and future processes.

“Further, faster, together…”

Nick Nuttal from UN Climate Change summed up the main objective of the 5-day process: “The Paris agreement was like a shiny new concept car – looks incredible, but there’s as yet no engine under the bonnet. The CFA is helping to create that engine, and move the car from concept to the road”. His final words rang true for the audience: “This”, he said “is where the future is…”

Want to learn more about what went on at #CFA17? Sign up for our ‘NDC Financing Made Easy‘ webinar, which will expand on the outcomes and teachings, read our twitter feed and previous blog posts.

Days 3 and 4 of theinnovative Climate Finance Accelerator, brought countries and financiers together to co-create solutions to meet climate commitments. This is the third in this series, following the process and highlighting insights from the day.

“I’m learning to be flexible”, said a senior country delegate on Wednesday, “to get on board and not give up – to jump, to hide, to move around obstacles – make it happen, and keep going until it’s done”.

All participants are showing entrepreneurial grit and determination as they begin to align agendas, reframe projects as bankable solutions and develop workarounds to challenging contexts.

Plenary discussions focused on four challenge areas:

Aligning interests, priorities and ways of working

Policy-makers and financiers have different mandates, related accountabilities and ways of operating. As one person pointed out “it’s like getting people speaking only Spanish to understand those speaking only Chinese”.

This is further complicated by the fact that within government institutions and across different parts of the finance community objectives differ and ‘green’ and ‘climate’ are understood differently.

A delegate from the public sector spoke of the insight that behind every question asked by the finance expert was a set of measures and the answer given is rated objectively in terms of commercial return. Once this was understood and the questions and underpinning framework made clear, the projects could be better framed against these terms.

A discussion on linking hard currency to local cash flow helped another group realise the value of local banks to fund local solutions. This group pointed out that even if there is good dialogue, it’s important not to lose focus on independent goals and the results needed to get to the best solution for end-beneficiaries.

A bemused banker spoke of trying to get a delegation to vote to prioritise projects – only to realise that they operate on consensus. Not only are people ‘speaking different languages’, often they don’t realise different cultures exist. However, it was acknowledged that “No single person or entity has all the knowledge needed to complete a deal. Everyone has a role to play”.

Scoping the opportunity

The discussion within the groups looked at how to understand the opportunity beyond financing a single project to: extend impact (e.g. by taking a regional view), leverage grant funding (by taking a longer term view of finance needs) and find finance for joined up solutions that address the problem in its entirety.

For some of the policy-makers, it was important to stretch projects to meet the scale of their ambition to maximise impact on NDC’s, and then work out how to finance this project. This meant understanding other sources of capital beyond project finance e.g. local funding, guarantees, etc.

A frustration was “how green is green enough?” In many cases funding is needed for both the transition (e.g. LPG) not just destination (e.g. renewable) in order to shift systems and this was not always aligned to funding mandates.

Funding set-up

Most funders are focussed on commercial returns from specific projects. However in order to get to this, there is an investment of time and resource and the need for capacity-building. A significant amount of work is required in order to find the data required to get funding. Time is required to engage all stakeholders – no matter how brilliant the projects. More work is required where no single policy champion exists to get support for opportunities through multiple government departments. Technical expertise and other resource is required to develop transition plans that contextualise projects over time.

There is a major need for specialist financial intermediation – people who have the structuring skills and investor networks to help project sponsors meet the needs and objectives of investors and get the deals done. In many markets this is not available except for very large projects and at high cost. “Lower end” intermediaries need to be developed both in number and capacity, and this will probably require concessional funding.

There is a potential role for Development Banks and Foundations to fill this gap.

“Oiling the wheels”

Doing a deal is easier where clear policy signals exist that welcome the private sector and any investment made is respected and protected.

Further, it is easier to move projects forward where early success stories or precedents from other places can be shared to create an evidence base against relevant metrics (e.g. number of jobs) for the change.

On Thursday, the discussions started to coalesce as teams look beyond individual projects to how a financing plan for their NDC has a whole can be brought into shape.

Follow @Money4NDCs and #CFA17 on Twitter to stay up-to-date with the latest from the event.

Want to learn more about what goes on at CFA17? Sign up for our ‘NDC Financing Made Easy‘ webinar, which will expand on the outcomes and teachings.

Yesterday we introduced you to the exciting, innovative Climate Finance Accelerator, bringing countries and financiers together to co-create solutions to meet climate commitments. This is the second in this series, following the process and highlighting insights from the day.

Today country delegates were paired with experts from international banks to discuss the enabling environment within each country involved. This was in order to understand which projects to prioritise and what financing mechanisms would be most appropriate. This technical deep dive session took a sector by sector focus to explore barriers to financial access and potential solutions.

All change happens in context and today’s process enabled finance participants to better understand the specific market conditions in each country, discussing policy and regulation, financial and economic, technical and market, social and cultural factors in detail. One delegate said that her views of emerging market opportunity had shifted because she’d realised that for the country she was involved with climate change was a very live issue and finding a solution is viewed as a necessity. This meant that engagement with both government officials dealing with extreme weather conditions and communities’ dealing with livelihood loss was easier and faster, than in other, more developed and resilient countries.

The afternoon plenary was opened by Dr Daniel Klier from HSBC, who heads up both strategy and climate finance for the bank. His compelling presentation outlined the gap the Accelerator is here to fill – pointing out that, based on HSBC research: 97% of investors want to increase their climate related investments, yet the market was viewed as ‘shallow and illiquid’, with a lack of clear definition on climate investment or transparency of opportunities. He stressed that the finance community has a role to play in creating liquid markets through standardisation, working closely with transition clients to reduce risk and in improving transparency through better data and disclosure.

A few cross-cutting themes included:

Developing a strong, diverse narrative

Part of the discussion across the groups centered on how to create a narrative to maximise the benefits and impact of investments and create access to more sources of finance. An example was how to finance fresh food value chains in Nigeria – to focus on strengthening local value chains for better production to create jobs, resilience, and shift from import dependency. The tomato crop alone has a deficit of 1.2m tonnes that is created by under-production, spoilage and lack of adequate distribution. This is an opportunity for the economy that could support climate-smart agriculture and local livelihoods.

All the teams noted that it was harder to work on agriculture than on transport and energy – yet this sector was vital for the transformation of these economies both because of the high climate impact and because of the co-benefits in livelihood and community development. Agriculture initiatives engage rural populations and support political stability. It was noted that taking a regional, portfolio approach might allow for insurance which would lower risk and make projects more attractive to finance.

A similar question arose on how to best package and then measure smaller energy efficiency projects – vital for the transformation – for financing.

Learning from each other

While there are nuances at sector level in each country, the similarities of the challenges faced allows for cross-pollination of ideas and sharing of precedent and practice. A call was made for an ongoing platform to be created to support countries in sharing experience.

Nigeria was paired with Deutschebank. The team developed a set of criteria to evaluate projects based on a detailed discussion of enabling environment. These included: having generation and distribution embedded in the community, developing clusters below 1MW to side-step time consuming regulation, ensuring developers and project leads have strong track records and focussing on smart models to collect money. A delegate from the country said a key insight for him was to how to approach and set up investments to better protect investor money. Nigeria is focusing on 3 mini-grid projects which will engage multiple communities.

Mexico worked with a team from HSBC. Looking at the transport sector, they expressed the need for supportive policy at all levels of government. They used precedents internally and from other countries, particularly Bogota in Columbia, to learn how to transform transport. Insights included exploring the opportunity for electro-mobility working firstly with taxis and distributing subsidies for a shift to electro-mobility directly to the end-user. However, there are still many questions on how to incentivise the shift, access best practice and technical assistance, invest into technology – particularly software required, develop T’s and C’s for fleet renewal and leverage international pressure to support the transformation.

A similar dialogue in the Mexico team on the energy sector raised questions on how to fill capability gaps, create working renewable systems and overcome “oil inertia” in culture and values. A delegate noted that a recurrent problem of land rights could be overcome through focussing on cash flow guarantees.

The Columbia team, working with BNP Paribus took a systems approach to the projects they set-out. This meant looking to expand large, bankable projects to incorporate other, smaller projects that were less easily financed but vital to the transformation of sectors. They looked, for example, at how to incorporate the development of bike lanes (which are hard to finance) with the larger metro development project to enable a complete transport system. A question they worked with was how to access funding not only for the project but to address the enabling conditions to better make the project work.

The day closed at the Crystal Exhibition on Sustainable Cities with inspiring talks from Pete Daw of Siemans and Matthew Scott from the Bank of England with insights on crowding in private finance and creating orderly transitions.

Day 3 is about priorities and we will dive deeper into the opportunities.

Follow @Money4NDCs and #CFA17 on Twitter to stay up-to-date with the latest from the event.

Want to learn more about what goes on at CFA17? Sign up for our ‘NDC Financing Made Easy‘ webinar, which will expand on the outcomes and teachings.

Today, above the flickering red and green signs of company stock at the London Stock Exchange, appeared a new symbol: “Climate Finance Accelerator”.

This sign, in this context, is a strong signal of a movement gathering momentum to shift countries and companies towards a low carbon, sustainable economy. It marked the launch of the first Climate Finance Accelerator, a bold initiative bringing together countries and financiers to co-develop plans that can help counties transform their economies to mitigate and adapt to climate change.

Country delegations from Nigeria, Mexico, Columbia and Vietnam have been teamed up with London based financial experts and development banks to co-develop detailed investment plans for bankable projects in an intensive 5-day process. The CFA is the brainchild of serial climate change-makers Ian Callaghan and Tessa Tenant and was set-up together with PWC and Riccardo. It provides a structure to help countries attract the finance needed to meet the climate targets they set out in the Paris Agreement.

One can understand why this is attractive to the private sector, once the sheer scale of the finance gap becomes apparent – Sir Roger Gifford, speaking this morning, put the need at $90trillion. Mexico alone is looking for more than $100bn by 2030. Countries have already committed massive budgets and are looking to the sector for smart financing arrangements for further billions.

This mini-blog will follow the teams over the next few days and highlight some of the emerging themes, resources and ideas coming through that may be useful for others working in similar areas.

A few themes that emerged today, including:

The power of multi-stakeholder dialogue

Nanno Kleiterp, development financier, said “it’s all about learning to understand each other’s language”. Hans Verholme, supporting the Nigerian delegation, mentioned “It’s about merging conversations at national and international level”. The Mexico delegation, which had representation from Government, local banks and the guild of taxicabs, noted that by involving diverse stakeholders CFA-inspired conversations had already significantly progressed the agenda.

Similarity in sector focus

Of interest is the similar focus areas across counties; transport (specifically, electrification and shift from private to public modes), energy (implementation of renewable and efficiency measures) and agriculture (including smart agriculture and land-use shifts). This offers opportunities to learn from existing projects and for collaboration, knowledge-sharing and replication.

The management of risk

The CFA initiative removes the information asymmetry that raises the price on projects by making opportunities more transparent to the finance community in a language they understand. It also allows them to weigh up endogenous and exogenous risks and develop blended and specific solutions to address each of these. Ultimately this will (as Michael Lewis from Deutsche Bank pointed out), lead to suites of new products from these institutions. It is also noted that part of the bigger transformational journey will need to include insurance companies. A Government led initiative, like the Green Investment Bank, supports increased market confidence by showing intention, creating focus and offering first capital.

Link to development

As Nigeria said in their opening statement today “Climate and development are inextricably linked”. Climate projects have multiple co-benefits that make them attractive to counties. In the UK 430 000 people are already employed in the green energy sector and it is growing at more than 12% p.a. For Nigeria, the opportunity to create new value chains in agriculture will support food security and lower cost of imported food. All of the counties mentioned the projects discussed as an opportunity to increase access to energy and alleviate poverty.

A wide range of creative finance structures and solutions are already deployed

While this was listed as the most important barrier for countries to move forward with their plans, other factors that need to be addressed include: in country capability development, ensuring strong governance and legal frameworks and community engagement.

A great start! Ed Wells, of HSBC, said today that “the money is there. If we can create the structures, it will flow”. Today (Tuesday) we start in earnest creating those structures, with the country teams working at different banks on an immersive ‘deep dive’ into enabling environments and how to prioritise projects.

More to follow…

Want to learn more about what goes on at CFA17? Sign up for our ‘NDC Financing Made Easy‘ webinar, which will expand on the outcomes and teachings.

Follow @Money4NDCs and #CFA17 on Twitter to stay up-to-date with the latest from the event.

This article is a collection of thoughts from many of the participants of the Monday evening Crowd Forum. We are ‘learning our way’ into a better future and would be grateful for any further thoughts, comments or references that can expand the conversation.

Monday night’s Crowd event was packed with people curious as to whether emerging technologies could support or detract from the sustainability and business agenda. Some were there for fear of keeping their jobs safe from the rise of robots; others were actively developing artificial intelligence, technology platforms and big data solutions to support clients. Some, like me, were curious as to what capabilities we will need to be relevant in a ‘machine’ future. Others wanted to understand how they could use their agency to shift outcomes of this disruption towards the positive.

After excellent talks from Sean Culey, Kriti Sharma, Prof. Kerstin Dautenhahn, Avida Hancock and Chris Middleton, I was lucky enough to chair a table full of curious minds from business, consultancies and NGOs. Thank you to everyone for sharing your thoughts and experience. Below are some of the themes and questions that arose…

The threat

Many fears surfaced about the rapid rate of automation and the resulting job losses. We heard from Chris, that last year China bought 66,000 robots, replacing 1m jobs. As these robots learn and become more effective, more jobs will be replaced. We learnt that the 8.7m people in the US in the ‘driving industry’ are at risk from autonomous vehicles, as are the 1m people in call centres in the UK. Yet, jobs have been replaced by automation for a long time – the difference is that with adaptive robots, coupled with artificial intelligence, more ‘skilled’ jobs can be replaced. Google translate took a large team of programmers 10 years to put together, however, within a few months, starting from scratch, an AI team had a solution that was just as good. This AI solution now has far surpassed the original one designed by humans. Pepper, a ‘humanoid’ robot recently conducted a funeral. As one speaker said, “if you can explain what you do for a living, your job can, and will, become automated”.

Another fear raised is the threat to our existing social systems. How will our economic system deal with a “zero cost society”? If we see a concentration of technology in the hands of the few and a bigger rise in inequity, how will this affect our social and political structures? And how can our slow regulatory structures respond adequately to the super-charged rate of change?

Sharma Kriti raised another issue that struck against the fabric of our social structures when she quoted Gartner, “by 2020, the average person will have more conversations with AI than with their partner”. “Already we are more ‘wedded’ to our smart phones than our partners”, quipped one person.

One of the biggest areas for emerging technology is in war. The room went quiet thinking about the possibility of an AI driven apocalypse, the ability of this technology to radically change the way in which war is waged.

This wave of automation differs from previous waves both because of the speed of change and because it is connected, machine to machine. This means machines can interact without human interventions. It is predicted that by 2045 ‘tech singularity’ will emerge where machines will far surpass humans and not be controlled by them or need to include them, at all. What then, people asked, is left for all of us?

A reality check

Before the last major technological disruption, we were a largely agrarian society. Now, only 2% globally work in agriculture. Humans are innovative and adaptive, and have managed in the intervening years to create new jobs and new ways to contribute to society. The question is how to transition as quickly and smoothly as possible in order to minimise the pain of transition.

We also forget that technology is neutral; it has no agency of its own and will only be as good or bad as how it is applied. For example, fire can burn your house down or keep you warm – it’s what you choose to do with it. We need to understand what new mechanisms we need in order to put technology to its best use in service of all of humanity.

This means that the biggest challenge is as quickly as possible to create the new societal model required for 7bn humans to flourish in a machine world.

The opportunity

On this basis there are fundamental shifts required now in every aspect of our society.

Those involved in creating technologies need to be educated to think through the implications of their activities. They should ask themselves ‘why’ they are doing a specific piece of automation – are they solving the right problems? They need to be clever about design and the databases they use to avoid coding in the social issues we suffer from today. Already we’ve seen problems emerge with MIT facial recognition software that couldn’t recognise black women and a prison system in the US that replicated the existing issues within the system when making recommendations on re-offending. An opportunity exists to use technology to build a better society and to remove the stereotypes and prejudices society currently suffers from.

Businesses need to change their mindset in three important ways: First they need to ‘think like Amazon’. They need to put the customer at the centre of their efforts and ask themselves different questions including, “How do you treat a physical product like software?” and, “How do you innovate in real time?” They need to consider localisation and micro-logistics, work with ‘prosumers’ to manufacture (possibly with 3D printing) on demand and look to shift their business models from products to servitisation. Secondly, they need to build capabilities to be resilient against whatever emerges – as Ocado put it, “forget forecasting – learn to deal with uncertainties”. Last, they need to model Tesla – create the systems of the future where, having everything interconnected means an exponential opportunity to learn.

For sustainability, the news from an environmental perspective may be good. Already the Smartphone had condensed our need for lots of different equipment into a small handheld device. We should see more dematerialisation and therefore less impact on resources. Technology can also support the circular economy through providing better designed products, tracking them and providing essential services to maintain and ultimately re-use them. Manufacturing on demand and mass customisation may lead to less waste and localisation to less carbon through distribution. From a social perspective, some argue that the rise of machines will allow us more time to focus on relationships while the robots take care of administration. They see a revival of local commerce. They believe that in a few years anyone will be able to design and automate – that it will be as simple as designing a website and that this will democratise technology. Last, they say rising transparency will force better behaviour from corporate and individuals. Sustainability professionals, grassroots activists and communities need to work with technology as an opportunity to make their agenda more relevant to businesses and to leapfrog existing systems.

As Geoff Kendall suggested, Governments need to come together as they did for the SDGs – to create regulation to ensure the social and environmental benefits are hardwired into these systems. They need to work out how to support individuals through the transition (e.g. through the Universal Basic Income), how to educate differently and how tax should be collected and distributed.

Our political, economic, and social systems were created in a very different world than we live in today. Perhaps this offers the opportunity to revisit the foundations of our society – to ask what good looks like in a machine age and whether some of our assumptions upon which we live our lives are still valid. Do we need jobs? Should everyone work? How do we all want to live? What are the components of a happy, healthy society?

As Peter Drucker says, the best way to predict the future is to create it.

Let’s get busy, then…

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This post is by Nicola Millson of The Future Academy. We work with organisations to ‘learn our way into a better future‘. Please do contact nicola.millson@future-academy.co.uk if you have any comments or suggestions.

A fascinating take on expanding design thinking towards systems change from the brilliant Rowan Conway of the RSA. First published on RSA site on 26 July.

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After a prolonged adolescence where style perhaps outweighed substance, design thinking has grown up. Now is the time to combine design methods with systems thinking to enable the adaptive and innovative institutions we need for the future.

We live in disorienting and challenging times. As society becomes more networked, the traditional centralised power of governments is under pressure. It’s a tough time to be a political leader attempting to deploy tried and tested tools when society no longer behaves in tried and tested ways. Those formal, linear, definitive strategies that once cascaded down from a central point are now under continuous challenge by a youthful networked power that is digital by default and quick to adapt to change.

Design thinking was born of this youthful zeal and the last 10 years has seen a profound shift in what we understand as design. Driven by the exponential growth of the social web and digital services, designers have gone beyond the classic understanding of design as producer of artefacts, into design as creator of services, policies, processes, business models and governance structures. Human-centred design thinking methods — and service design in particular — have infiltrated business, government and third sector institutions and reinvented the way they approach innovation. And this in turn is disrupting traditional notions of how policy-making, business development, R&D, organisational design and strategy are done. As this diagram from Lean Ventures shows, rather than providing a clear route to a single solution, design thinking methods lead to many solutions, stimulating creativity and idea generation that arrive at a variety of innovation types.

Design thinking and social challenges

In a report on social innovation, the Rockerfeller Foundation suggested that this type of creative thinking is critical if society is going to respond deftly enough to the major societal challenges of our time. It says: “Due to the complex, systemic, and interrelated nature of the serious social, economic, and environmental problems confronting us, we need entirely new forms of solutions. Clearly, we humans must learn to think differently about our complex world and to work together in unusual and very strategic new ways.”

Designers are beginning to answer this call. With design thinking methods at their disposal, they are now setting their sights on the grand social challenges of our time. In a 2017 RSA lecture, Jeremy Myerson, founder of the Helen Hamlyn Centre at the Royal College of Art, described how designers are responding to the modern challenges of public health, climate change and inequality. He pointed in particular to our ageing population, and how it is both opening up new consumer markets for products like the ‘grankini’, while also providing opportunities for designers to tackle major public service challenges by reinventing services for the care of the elderly — in particular the rising demand for person-centred dementia care.

Impact beyond the challenge prize

Challenge prizes and competitions do lead to genuinely creative solutions to social problems, but there are many stories of innovations either struggling to grow beyond their test boundaries (ie: failing to replicate a nurse-led solution in one hospital across multiple sites) or make long term traction in wider systems (ie: the challenge of scaling an innovative solution when there is no consumer market demand). For challenge prizes or procurement tools to stimulate sustainable innovation, they need to be designed with wider systems impact in mind.

In this new RSA report, From Design Thinking to Systems Change produced in partnership with Innovate UK,we look at how to go beyond the creative process to have real impacts on the wider social systems in which social challenges sit. Our report looks at the UK government’s SBRI procurement process in more detail and suggests ways to support the innovations that it stimulates to have lasting impact.

A key finding is that problems aren’t the same as markets. Competition commissioners are rarely the same as the end buyers of the solution and the social challenges or the public service problems that stimulated the brief in the first place do not necessarily equate to clear market opportunities. Challenge prizes or SBRI competitions may create ‘competition demand’, but providing the elusive first customer does not provide a guarantee that there will be a second or third customer. In one case studied, the market demand was so low that it was largely met through the competition, even though the public value of the innovation was very significant.

Design for systems change

The innovation challenge is not just the generation of good ideas — it is the application of those ideas in the world. It is impact. Design alone won’t always generate large scale impact. This report looks at how we might apply a systems thinking dimension to design thinking methods, and defines the new RSA model of ‘think like a system, act like an entrepreneur’ as a way to marry design and systems thinking (the below diagram tracks the two modes onto the Design Council’s famous double diamond model of design thinking).

Systems thinking augments the design thinking approach by appreciating the complexity of a social problem and seeking to understand factors like power dynamics, competing incentives and cultural norms. Thinking systemically about how problems are defined is an advance on traditional design thinking as it extends beyond the creative process into broader social change theories. There are pioneers in this field like the system innovation lab at Forum for the Future and the Lankelly Chase systems changers programme, but adding a systems perspective to design thinking processes now needs to move from the vanguards to the mainstream.

Making change in systems as complex as public health or education may seem insurmountable. Applying a systems lens to the question of how procurement programmes like SBRI might be optimised for innovation, we can glimpse the greater impacts that could be achieved. This is where, at its best, SBRI has the potential to serve the dual goal of both making commercial markets for innovations and delivering social impact at scale.

By applying the think like a system, act like an entrepreneur mindset, we do not attempt to take on grand societal challenges in their entirety, instead we look to identify nimble opportunities for change within the system — seeding innovations, testing prototypes and supporting successful efforts to grow and influence other parts of the system. By seeking to understand the wider system that an innovation will be born into, designers can seek to find ways to successfully affect systems change.

When we start something new, when we’re looking for solutions or are making an important decision we often look for sources of inspiration and perspective within our companies or sectors. We might interview our customers, employees, or suppliers. We might ask academic institutions or experts. We could commission research to see what competitors or even other sectors are doing.

Too often we miss out on asking advice of a rich source of wise answers that exists right in front of our eyes… nature.

Our planet is old – 4.5 billion years old. And for an astounding 3.8 billion years, it has harboured life. Life has had a bit of time to evolve strategies to maximise existence and sustain itself! It has arrived at well-adapted solutions that have stood the test of time, within the constraints of a planet with finite resources. Each new shoot or seed is nature taking a lean methodology approach to experimentation and rapid prototyping to find better solutions every time they grow. Millions of organisms have adapted and evolved to survive, to meet their needs efficiently within the limits of the planet and alongside all other life forms.

How could we learn from and emulate nature’s successful strategies?

PRODUCT DESIGN

Nature is a master designer – and companies are catching on to the fact that they should look to how nature has addressed a specific challenge in order to come up with an optimised solution. This means looking at how shark skin is able to move sleekly through water and using that in swimsuit fabric and ship paint. It’s about a shift from rectangular, flat solar panels to ones that are shaped like leaves – the longest ever experiment in optimising surfaces for capturing sunlight. Interface designed pads to secure its carpet tiles to floors inspired by the way lizards have foot pads that enable them to cling to surfaces. This has transformed the carpet industry, created disruption in the glue industry and cut costs, reduced impact and provided a competitive differentiator for the organisation.

Questions to ask: What is the challenge I’m trying to solve? How does nature perform this function?

2. PROCESS DESIGN

In comparison to the sleek processes of nature, human processes are clumsy, wasteful and inefficient. Take manufacturing, a “take, make waste” process. We draw components out of the ground, turn them into products that may or may not be used and that ultimately land up in landfill. A tree takes resources out of the ground, moves it up a spiral and produces leaves. These resources are deposited on another side of the tree, ensuring broad distribution of essential elements that become resources for the next leaf.

Or look at innovation processes – many run by specialist teams stuck away in a room of a large building, silo’d and shut off. Nature innovates mostly in the edges – bringing together diversity between habitats (e.g. swamp land and grassland) and seeing what emerges. As the edge increases, the boundary habitat allows for greater biodiversity. Change happens at the fringes and the longer the ‘edges’ the more diversity and more change can happen.

Questions to ask: How does nature perform this process? Specifically, how could my organisation manufacture in a way that optimises resources? How can we create ‘edges’ and ‘intersections’ for our organisation to collide with others for increased diversity of thinking and accelerated innovation?

ENTREPRENEURSHIP AND VENTURING

Recently I worked with a bright Imperial College graduate with an excellent idea that could shift the virtual reality industry by allowing better understanding of location for the user. He thought of how a new ecosystem would replace an old one in order to ensure that his product could be part of a technology shift into a new space. Steve Jobs did this with the iPod. Instead of just launching a ‘me too ‘music player, like the Sony Walkman, he defined the entirely new ecosystem that his music player would operate within – and the route to shift the industry. For this to work we need to think like nature – what is the broader function of this ecosystem, what are the elements that are needed to sustain it, which are key stone species?

Questions to ask: What is the broader ecosystem my venture is operating within? How do I effectively inhabit that?

ORGANISATION RESILIENCE

Oak trees feed squirrels acorns, and squirrels eat harmful fungi off the oak. SABMiller buys its hops from farmers that buy its beer. Lloyd’s Bank worked with me to understand how to make the communities it operates within and takes transaction fees from, wealthier. We don’t operate in silos – everything is interconnected. Shifting thinking from being separate from the world around to being interdependent allows for greater resilience.

Questions to ask: Where can I increase my resilience by understanding and leveraging inter-dependencies?

CHANGE

Nature is always in flux. We can see a tree as a static object – trunk, branches and leaves. Or we can see it as a process in motion, taking up water and nutrients, depositing them, storing them and releasing them. All organisations (and individuals within them) are in motion. We resist change, but it is inevitable. We can learn to flow with the changes and adapt, rather than take a static view of where we are. This involves seeing the emerging seeds of change and consciously deciding which ones to water and which ones to pluck out. It requires us to see beyond our current horizon into horizon two where these seeds will start growing to horizon three where the change will take root – and to plan and organise accordingly.

Questions to ask: What are the emergent properties of this current situation? How do I leverage them for future success?

Einstein famously said you can’t solve a problem with the same level of thinking that created it. Looking for answers in nature allows you to use ancient tried and tested wisdom to leapfrog contemporary thinking and to come up with better ideas.

Step away from your desk. Walk away from the board room. Take a walk in a park nearby. Look at patterns, look at functions and look at the way nature has worked out how to live. Be inspired. And please do remember to respect, protect and, even better to regenerate this great mentor.

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This article is taken from a speech delivered for Interface in 2016 and to the Swiss Advisory Group in 2017. If you’d like me to speak to your audience on this and other topics that inspire action and shift perspective or to find solutions with you to tricky challenges, please do get in touch nicola.millson@future-academy.co.uk.